Salesforce CEO claims victory as software sales rebound, signaling turnaround

Salesforce’s fiscal‑year revenue topped $41.5 billion, edging $600 million above the company’s own guidance of $40.5‑$40.9 billion and delivering a 12 percent year‑over‑year lift in Q4 to $11.2 billion, according to the earnings call transcript cited by The Register. The upside, however, was largely attributable to the $399 million contribution from the Informatica acquisition, meaning organic growth was roughly $200 million—a modest gain that analysts flagged as “disappointing” (Morgan Stanley’s Keith Weiss, The Register). The firm’s remaining performance obligations (RPO) settled at $35.1 billion, falling short of expectations for a “beat” in unrecognized revenue, further fueling investor scepticism despite the headline‑grabbing top‑line number.

Benioff leaned heavily on the company’s new “Agentforce” IT‑service offering to explain the rebound, proclaiming the launch of Salesforce ITSM in October and the acquisition of 180 customers within weeks. He highlighted five marquee wins—SunRun, Cornerstone, Cool Systems and two undisclosed firms—describing them as “leaving the purgatory of ServiceNow” (The Register). Analysts view the rapid uptake as a direct challenge to ServiceNow’s enterprise‑ITSM dominance, but they also question whether the nascent Agentforce line can sustain momentum beyond the initial wave of early adopters. The same call saw Benioff adopt a mythic “Sasquatch” metaphor, positioning Salesforce as a “SaaSquatch” that will “devour the SaaSpocalypse” by capitalising on the surge in “agents as a service” (The Register).

The earnings release also announced a 5.8 percent quarterly dividend increase to 44 cents and a $50 billion share‑repurchase programme, yet after‑hours trading saw the stock slip 5.6 percent (The Register). The divergence between cash‑return initiatives and the tepid RPO figure underscores the market’s concern that the company may be over‑leveraging financial engineering to mask underlying growth challenges. Weiss asked whether Salesforce can “grow a big Agentforce business and sustain the growth and momentum in the broader Salesforce portfolio,” a question that resonates with investors who are watching the broader SaaS sector grapple with valuation pressures linked to AI‑driven product shifts (The Register).

In parallel, Reuters reported that AI‑driven software adoption is lifting Salesforce’s outlook, prompting an upward revision of its annual forecasts. While the article does not quantify the AI impact, it aligns with Benioff’s narrative that “SaaS just got a lot better with agents as a service,” suggesting that the company’s AI‑enhanced offerings are beginning to resonate with enterprise buyers (Reuters). Nonetheless, the mixed signals—strong headline revenue, modest organic growth, a sizeable dividend hike, and a muted RPO—paint a picture of a firm in transition, relying on a blend of legacy CRM strength and emerging AI‑centric products to navigate a market still wrestling with the so‑called “SaaSpocalypse.”

Overall, Salesforce’s Q4 performance delivers a narrative of recovery anchored in a bold AI‑first strategy, but the underlying metrics reveal a cautious optimism. The company’s ability to translate Agentforce traction into sustainable, organic revenue growth will be the litmus test for investors, especially as competitors such as ServiceNow, Workday and emerging open‑source AI platforms continue to vie for the same enterprise AI spend. The next earnings cycle will likely determine whether the “SaaSquatch” metaphor holds water or remains a colourful rallying cry.